Individuals who are not real estate professionals are generally subject to passive activity loss limitations even if they materially participate in the rental.
Real estate professionals report rental real estate activities in which they materially participated as nonpassive. But, real estate professionals who do not materially participate in the rental activity are generally subject to passive activity loss limitations.
Publication 925, Passive Activity and At-Risk Rules, has more information on who qualifies as a real estate professional and passive activity limits.
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